Old Wood Is New Coal as Polluters Embrace Carbon-Eating Trees

Wood is becoming a hot commodity in a new low-carbon world.

Power companies are burning trees because they’re renewable and can be cheaper than coal. Wood needs no permit to release carbon dioxide, a greenhouse gas blamed for global warming.
Vattenfall AB of Sweden, Germany’s RWE AG and American Electric Power Inc. of Ohio, the biggest coal-burner in the U.S., have switched a few plants over to wood and more are planned. So far that hasn’t driven up paper prices or strained forests, which absorb carbon dioxide in photosynthesis.

“Wood is very quickly becoming a very important part of the energy mix and in a few years will be a global commodity much like oil,” said Heinrich Unland, chief executive officer of Novus Energy GmbH. The German company runs a wood-power plant north of Hamburg that supplies heat to a Total SA refinery.

Using biomass for power and heat — mainly from poplar, willow and pine trees — grew by 25 percent during the past two decades, according to the International Energy Agency, the Paris-based adviser to 28 oil-consuming nations such as the U.S.

While forests blanket about a third of the planet’s land surface, they’re being harvested or burned at a rate that reduces tree cover by a Greece-sized area each year, sparking concern about whether replanting efforts will keep pace.

“There’s a strong limit to supply,” said Albrecht von Sydow, chief executive of Woodstone, a U.S. maker of wood pellets. Demand for the company’s pellets exceeds supply and this year’s production is already sold out, he said.P>
Bloomberg